When condominiums are purchased “new” from a developer, the square footage of each unit is derived from architectural measurements are the standard by which every builder works from. They are the building’s blueprint, complete with mechanical locations and dimensions, from which the building is constructed.

Purchasing a new condominium is very similar to purchasing a new single-family house. When talking about square footage, defining the space you’ll own from your neighbor’s space they’ll own once the building is completed is the difference. Here’s an example to illustrate. When you purchase a new 2,000 square foot home, you never subtract the area made by the 2 x 6 exterior walls even though these walls are built in from the foundations outside edge, nor would you subtract the area within which your mechanicals are run, effectively reducing your total useable space. When talking about the size of your home, you say you have a 2,000 square foot home, not what’s left after the exterior walls and mechanicals are subtracted from the size of your finished home.

To derive the final, legal square footage of condominiums, (that size which appears on the registered condominium plan), the unit is measured in the later stages of construction. This is due to the rules of condominium ownership. You own your unit’s space, exclusive of the common space that now exists between units, within exterior walls and mechanicals. You own a representative share of the common space, not the space itself. It is in this common space where the buildings mechanicals, plumbing, soundproofing and support structures are located and these are jointly owned by all unit owners.

When a new building is constructed, many units are built together, at the same time, not separately as with a house. Therefore, construction considerations are compounded. For instance, if the developer decides to add or upgrade a new air circulation system to enhance marketability, this could affect where the air ducts need to be located to optimize airflow/cooling or where some of the other mechanicals are located. Plumbing and other mechanical locations may need to be amended for proper installation. These and other factors, including deducting the exterior unit walls, all affect the final legal floor area of each unit.

When you insure your condominium, the insurance is for your contents that you own, not for any of the common property or the unit itself. The condominium corporation maintains a separate insurance policy for the building including units and common property. With condominium ownership you own a percentage of the total common property. Each owner is responsible for his or her share of the cost of maintaining the common property. This is paid through condo fees.

It is important to remember that the unit factor that was provided by the builder prior to the final registering of the condo plan remains the same once the plan is registered at land titles. Therefore your percentage of total ownership in the common property does not change. This places all condominium owners on the same level playing field when they go to resell their units just as when they originally purchased new.

Plastered all over the news these days are stats regarding the Calgary residential real estate market. It’s hot, it’s quick and home owners are realizing substantial appreciations in their property values. You, as a condo owner, may be thinking now is a good time to take advantage of this situation. There are several areas you need to be aware of and prepare for in terms of marketing your condo to prospective buyers compared to an owner of a single family home.

Most condo buyers and sellers are aware that certain condominium documents are required when a condo is sold. What most people don’t realize is that the items to be included in this package, and the right of a buyer to receive them, is mandated by Alberta Law. If you are selling your condo, what do you need to provide to the buyer, how do you obtain them and what is the cost?

Most condominium buildings hire a management company to look after the day to day running of the condo corporation, under the direction of the board of directors. This management company is also responsible to maintain all the documents pertaining to the corporation. The management company, must, upon written request from an owner, provide the following documents:

• Bylaws of the corporation
• Financial statements
• Monthly balance sheet
• Budget and fee schedule
• Reserve fund study and plan
• Amount in the reserve fund
• Details of any special assessments or judgements against the corporation
• AGM minutes and last 12 months of board minutes
• Percentage of owner occupied units
• Insurance certificate
• Management agreement

Be aware, the management company will not provide these items for free! The cost for an entire package can range in price from $100 – $700! This cost is the owners responsibility and these documents must be provide to any buyer. Keep in mind, an informed buyer will most likely make an offer subject to the receipt and approval of these documents. It is always easier to have these documents ready to go for a buyer once an offer is accepted.

There is also valuable information for you, the seller, in these documents. The bylaws will dictate if you can market your property by way of a for sale sign. Many condominiums will not allow signs of any kind. So how are you going to let people know your property is for sale? Will a Realtor be able to place a lock box on the property to gain access to your property for showings? Information regarding issues like these can be found in the bylaws, or by checking with the management company. If your ability to market the property yourself is limited by the bylaws, you may want to employ the services of a Realtor who has a comprehensive marketing plan that deals specifically with condominiums.

Another major issue buyers are looking for pertains to special assessments. Are there any coming, are any payments outstanding or has a special assessment been amortized over a period of time, in essence increasing the monthly condo fee? Special assessments can have a major impact on the marketability and market value of your property. Don’t let there be any surprises waiting for you!

In order to capitalize on your equity and investment and to avoid any pitfalls, an experienced condominium Realtor will be able to guide and assist you in achieving a successful sale of your condominium.

Get ready, Calgary, for “big city” floor plans! And I don’t mean “spacious” floor plans. The downtown condominium market is seeing a huge supply and demand for 1 bedroom floor plans under 650 square feet that used to be unheard of in Calgary. New developments like Tarjan Pointe, Chocolate, Union Square and Midtown have a high percentage of their suites under the 650 square foot mark. In most cases, these are the suites that are selling out the fastest!

In comparison to larger units in a new development, the smaller units will be the most attractive to some buyers based solely on price point. Both first time buyers and investors alike will look for the lowest price point. But don’t be surprised by the prices. These cozy 1-bedroom suites are not cheap! Prices can range from $130,000 to over $230,000, depending on the level of finishing. That’s over $330 per square foot! And we are seeing more buyers willing to pay for high end finishing even in these smaller units. Most newly constructed single family homes in Calgary fall well under that figure.

So what is driving this new trend of smaller, more expensive units? There are several factors to take into consideration. The first is land value. There are fewer empty lots to be bought in the inner city core. So that means prices for land close to downtown has moved up. Add increased construction costs and the profit a developer is going to make on a building is decreased. A good way for them to keep their profits up and supply the markets thirst for quality is to design creative, well appointed smaller sized floor plans and charge more per square foot for them.

Another reason is the huge influx of skilled and educated young people in Calgary. Calgary has the highest percentage of people with post secondary education in Canada. With interest rates low, many of these people appreciate the benefits of owning property rather than renting. Even though they may be fresh out of school, they are looking to buy. The lower priced condos match what their budgets can afford. And the location is close to where they are working. Plus, with occupancy up to 18 months away, they have more time to save the down payment needed at closing. This down payment also acts as an investment with future increases in equity in the property. Owning is affordable and you’re making money. Seems like a match made in heaven!

Although some people may speculate that these smaller, more expensive condos won’t fly here in Calgary, they certainly seem to be filling a necessary niche of the inner city market.

Go into any new condominium show suite these days and what do you see? Sleek, contemporary, urban furniture, perfectly staged to showcase the new homes offered for sale. But look a little closer and you may notice that as lovely as the furniture is, it’s on a scaled down size as well. You may wonder, are people getting smaller? No, the condos are! Condominium space is at a premium in Calgary. New condo buyers are adapting to much smaller living spaces. In fact, new condo owners confess that letting go of “stuff” they have been holding onto for years has been quite liberating.

One way people are doing this is to maximize all available floor space with furniture with great design. Sculpted chairs instead of loveseats, chaise lounges instead of bulky couches, ottomans that double as coffee tables or additional seating are but a few of the furniture choices today’s condo buyers are utilizing. And there are more choices than ever, to suit every budget range. From Ikea to Home Evolution, scaled down, chic furniture is available for everyone. For a lot of new condo buyers, new furniture is a major propriety after moving in!

Another trend appearing more frequently in newer condos is the use of builder installed built-in furniture. In additional to functional furniture, you’ll see built-in computer/work stations in numerous show suites around the city. Tucked against a wall or around corner is a customized work station for the new condo owner. It takes up less space than a desk and you don’t need a separate room to put it in. A perfect match in your cozy new pad!

But what does a new condo buyer do with all the “stuff” that we all seem to haul around? Christmas trees, bikes, winter snow tires for the car, your old stuffed animals you just can’t bear to part with? You certainly won’t be able to put all these items in a 650 square foot 1 bedroom condo! The solution is additional storage space or lockers in the building for each owner. This feature is rapidly becoming mandatory for buyers, and developers are listening by providing appropriate storage space conveniently located in the building.

If smaller condo living appeals to you the next step is to make a list of the amenities you require that will suit your new lifestyle.

Your pride and joy sits alone, cold and exposed to the elements ever since you drove it home. It just doesn’t make sense that what you have worked so long and hard for doesn’t have a warm, safe place to roll into at the end of the day.

Isn’t it time you made the decision that no mater what, you will find a safe and protected home for….your coveted car! For many of us our cars define and represent to others who we are. This defining statement says in some cases more about us than the clothes we buy the jobs we have and the places we live. So how does our obsession with cars fit into the world of condominiums you ask?

Parking, especially downtown, has become a luxury item and has become a major amenity when purchasing a condo. The question to ask is does a parking stall come with the proposed purchase of a condo? If so, is the stall exposed to the changing and unpredictable elements or is it in a secured underground parkade? This distinction can make a huge difference in the price of the condominium unit and its desirability. As the price of new cars and insurance escalates common sense dictates that this prize possession must have secured parking.

In today’s untraditional real estate market purchasing a new, to be constructed condo, the price of an underground parking stall can affect the total purchase price by up to $27,000! When purchasing a second stall you can expect to double the cost. In this day and age the need for a second stall is a necessity, to accommodate a significant other or guests that may come to visit as visitor parking downtown is at a premium Sales have been lost due to buyers not having access to additional secured parking.

The number of available stalls and their locations are not the only considerations when looking at the parking issue. Parking stalls can be individually titled, just like the residential unit you live in. Or they can be assigned or leased to owners at the discretion of the condominium corporation. Which scenario you have in a building can affect the value of that stall. Individually titled stalls carry with them more perceived value as they can potentially be sold to another person separately from the residential unit. In addition to their additional value they also carry with them added expense. What most people don’t realize is that the City of Calgary affixes a property value to these titled stalls and then proceeds to tax them in addition to the condominium unit. This is not the case when parking stalls are classified as common property under the condominium corporation. It is important to pay attention to which form of ownership your buildings parking stalls falls under.

Building security is also a major consideration when purchasing a condo. In some cases, the easiest way for a non-owner to gain access to a building is through underground parkades. Calgary Police Officers regularly schedule meetings with building owners to assess security issues and solutions. Being a pro-active condo buyer will help protect your car day and night!

Dreaming of Luxury? Calgary’s condominium market has many buildings and units that fit the luxury criteria. Even though luxury can mean many things to many different people, chances are, there is a condominium that matches your definition and requirements.

When “luxury” is discussed, most people picture in their mind a high-end level of finishing. Features like gleaming hardwood floors, stainless steel appliances, gourmet kitchens, marble and granite counters and floors, sumptuous ensuites, oversized casings and mouldings, soaring ceilings and non-stop views are but a few of the images that you would expect to see in a “luxury” condominium. Calgary offers many buildings both new and established that automatically fit these images, but there are many individual units in a variety of buildings across the city that have seen spectacular renovations that place them firmly in the category of “luxury”. All you need to do is look at the number of condominiums that sell for more than a half a million dollars these days (nearly 70 in the past year alone on the MLS!).

Perhaps your version of luxury has more to do with a great location or proximity to amenities than with finishing. Adding the luxury of more time to your life may be what you are after. Many people are moving into inner city areas to facilitate an increase in personal time. With people’s busy lives, a shorter work commute, being walking distance to the gym, grocery store, movie theatre, restaurants and other services is what many people consider a luxury. There are many condominiums that match this criteria without being accompanied by a hefty price tag!

And don’t forget the luxury of additional services that a condominium building can offer owners. More and more buildings in the city are offering concierge services for their owners. For some, a concierge can be a true luxury, facilitating a multitude of services, not the least of which is security for the building. Additional amenities in some buildings now include fully equipped exercise facilities, car wash bays, whirlpool saunas, lap pools, wine cellars, meeting and board rooms, party rooms, hobby rooms, movie theaters and guest accommodations.

Almost all condominiums offer owners the luxury of having maintenance done for them. The management company co-ordinates snow removal, lawn and garden maintenance, garbage removal, building maintenance including parkade and carpet cleaning, elevator maintenance, administrative duties and many more behind the scenes jobs that owners don’t have to worry about. All this is looked after through the owners condominium fees.

So is luxury on your mind? Look to condominiums and let your dreams come true!

As diverse as the population is in Calgary, so are the communities that make up the inner city. Over the past 10 years as each area has seen an increase in new development, each has also been defining and refining it’s own identity.

Beltline – the communities just south of downtown include Connaught, Mission, Cliff Bungalow and Lower Mount Royal collectively make up the Beltline. A perennial favourite with the younger crowd due to it’s proximity to downtown jobs, restaurants and bars, shops and coffee houses. Many residents live here without requiring the use of a vehicle, all amenities are so close! There is always something to do, someone to meet or somewhere to go in the Beltline. There have been numerous new condo developments here over the past 10 years, as well as many older rental buildings being converted to condo ownership.

Victoria Park/East Village – this is an area to watch over the next several years. As the Calgary Exhibition and Stampede continues it’s land expansion and re-development, the surrounding community will have new life and vitality to spare! A ton of new, high rise, high end condo and commercial buildings are slated for the new Stampede Station area, offering upscale urban living at the gateway to Downtown. The city’s plans for the East Village will offer new and exciting condo opportunities for future residents, while also providing the services and green space inner city dwellers crave. Victoria Park also offers a unique selection of warehouse/loft condo buildings, not found anywhere else in the city.

Kensington – across the river the area of Hillhurst and Sunnyside are always on the cutting edge of trendy. Smaller condo developments, rental conversions and renovated character homes give this area a flair all it’s own. With Prince’s Island park and the Bow River Pathway system on it’s doorstep, a multitude of Kensington shops, services and restaurants to choose from and Riley park at the back door, it’s easy to see why so many people are clambering to live in Kensington.

Bridgeland – another area that has seen it’s share of redevelopment in it’s recent past with even more on the horizon, is Bridgeland. What used to be a predominately single family home area has been jump-started and energized with new condo construction, including the re-development of the former General Hospital site into The Bridges. If an ethnic flair is more to your liking, you will love the Italian groceries and restaurants, Tai food and other great services Bridgeland has to offer. And don’t miss out on some of the best skyline views this city has to offer, all from Bridgeland.

As you can see, no matter what your lifestyle, tastes or budget, the inner city has the perfect match for you.

There are hundreds of condominium buildings in Calgary. Each one is unique in its own way. Some have very distinguishing features such as a great architectural design, a swimming pool, running track, or maybe retail shops in the buildings. But can you name something that less than 10 condominium buildings in Calgary possess? The answer is a building concierge. This person is, by definition according to Webster’s dictionary, a caretaker or doorkeeper. In today’s age of busy lifestyles a concierge is so much more to the people who are lucky enough to reside in a building featuring a concierge service.

“Knowing that Arnold and Elaine, our building’s concierge’s, are on the job to ensure my guests are warmly greeted and know where to find my condo gives me great peace of mind. Not to mention the added sense of security I have because everyone who enters the building is received at the front desk” says Chateau La Caille resident Carol Bennet.

For Don Skelton of 500 Eau Claire, having a concierge in the building meant he could renovate his condo without taking on a scheduling nightmare. “When we moved into the building we had no idea of the value that having a concierge would bring. We spent months having work done on our condo, and if we had to let each tradesperson into the unit day after day, I would have had to quit my job. With our concierge there to let each tradesperson into the unit, our renovation went much smoother than expected. We couldn’t have done it without their service.”

Service is what the job of concierge is all about. For the owners and residents in the building, service can mean different things to each one. A smiling face to greet you after a gruelling day at the office, co-ordinating tradespeople for your renovation, facilitating fire equipment testing, disseminating condominium corporation information to all owners, having someone to accept your drycleaning when it is dropped off are a few of the many responsibilities and services a concierge has to offer. Most importantly, the concierge is the face of your building’s community that the rest of the city sees on a daily basis. The concierge is also a reflection of those who reside in the building.

With so few buildings in Calgary offering this dynamic service it is not surprising that these buildings are so desirable for people looking to buy condominiums. And this demand seems to be increasing. Of the few buildings offering concierge service, all but two have been built in the past seven years. Currently, there are 2 new concierge buildings under construction in the Eau Claire area alone and a third in Connaught. Maybe you see a need in your life for the services a concierge has to offer! Find out which concierge will meet your service needs.

Recently I was showing suites in an upscale, newly constructed condo building in Eau Claire. When I stepped out of the elevator it was like walking into a bright sunny day; the amount of hallway lighting was the most I had ever seen in a condo building. Every 4 feet a wall sconce was on either side of the hall as well as 4 overhead pot lights. You could almost feel the heat coming off the light fixtures. Later I was informed that the condo fee for the suite my clients were interested in had just jumped 30%, due mostly in part to electricity costs! With the amount of lighting in the common areas I saw and the type of light bulbs used this was no surprise.

Here is a classic example of how choosing a greener approach to our lives can actually pay dividends, rather than costing consumers more. The budgeted amount for electricity for this building prior to the condo fee increase was $110,000 for the year. Image if the condo association board for this building chose to change all the common area lighting to compact fluorescent (CF) bulbs. True, there would be an initial cost outlay to purchase new bulbs, at approximately $2 per bulb. However, the CF bulbs have a lifespan of 6,000 hours compared to 750 hours for incandescent bulbs and the energy usage is roughly 25% of incandescent bulbs.

Under this new scenario, the board would be able to reduce condo fees rather than have to increase them! When was the last time that happened? By thinking “green”, the owners of the building could actually save money. The board could go a step further and put in place a building policy that individual unit owners use a minimum number of CF bulbs in their suites as well. In the case of this building, the electricity for the suites is not individually metered and the condo association pays for everyone’s electricity. This small change would be a cost savings for the owners year after year.

The promise of saving a few bucks a year by using 1 CF bulb may not send you rushing out to replace your bulbs. But consider the wider impact when this is applied on a broad scale, as in a condo building. The green benefits suddenly become very tangible, especially to your pocketbook!

When condo buildings were constructed in the 1970’s and 80’s it was very popular for a building to have amenity areas for the owners. These may have included group/party rooms, saunas, hot tubs, exercise areas and change rooms. Over the years many of these have fallen into disuse or disrepair. On average, a small percentage of owners utilize these amenities. The emphasis placed on keeping them maintained and updated is diminished.

There is a financially rewarding option many condominium corporations are currently exploring. More and more are looking to sell these areas, either renovated or not, as individual residential units. There are several factors driving this trend in condo buildings.

The first is obviously the great increase in condominium property value Calgary has experienced over the past several years. Condo boards are eyeing the large sums of money that the corporation could realize from selling the unused or under-utilized common areas in the building as individual units. This money could be used to re-furbish other common areas such as the halls and lobbies or be put to major capital expenditures such as replacing old elevators or roofs, thus alleviating the need for special assessments or higher condo fees. Remaining funds could be allocated to the reserve fund for future use. Updating and upgrading the building would increase the overall property values of units in the building, thereby benefiting all owners.

The second reason for this trend is that these underutilized areas are usually a drain on the collective expenses of the building. They still need to be heated, cleaned and maintained. Boards are looking to turn this expense into an asset.

A third reason is that with another unit in the building paying condo fees, each owners monthly fees may actually decrease.

The process to convert common area to individual ownership is a lengthy one and involves the services of a qualified condominium lawyer as well as the guidance of the management company. A special resolution needs to be passed by 75 % of the ownership (not always an easy number to achieve). The condo plan needs to be resurveyed with new unit factors assigned to each unit. A title needs to be created for the new unit and each title in the building needs to be amended with their new unit factor. This whole process can take over a year and in some cases several years! Given the Calgary real estate market, the financial rewards for the corporation can be great and outweigh the time, effort and expense required.

Currently there are several buildings in the Beltline in various stages of this process. Over time buyers will see more of these situations as they look to purchase resale units, or even one of the former common area suites.

Recently I worked with a client looking to purchase a condo in the Beltline area. My client, a lawyer from Ontario, has had significant experience in condo living, serving on the condo board in the building where he lives in Toronto. After viewing many properties, the decision came down to one of two units in two different buildings.

Both buildings were nearly identical in age, number of units, style and size of units and parking (part indoors and part outside). The first building was located in a very desirable area with many amenities such as shops and restaurants steps from the door and offered a strong reserve fund, but had outdated common areas. The second building was in an emerging neighbourhood, with substantial construction of upscale condos and amenities in the works, but currently not as good a location as the first building and it did not have as strong a reserve fund. The suite in the first building was a penthouse and the suite in the second building was not.

While in different buildings, each condo met the client’s needs in terms of size, layout and number of bedrooms and price point. Which one to choose? After much research on my part it may surprise you that the client chose the unit in the second building with the less superior location and smaller reserve fund! Here’s why.

The sale statistics for the building he chose showed a trend of buyers repeatedly paying more for units in this building than in the first building which offered the better location and large reserve fund. It was obvious from first entering the chosen building that the owners and management had invested a lot of time, money and effort into their building. The elevator had been replaced, the lobby updated with new, longer lasting materials in contemporary colours, new window coverings were in the lobby, hallway lighting had been improved, silver hardware replaced the older brass style, there were updated fire exit signs, new parkade lighting installed and the parkade had been painted. In addition, after reviewing the condominium documents it was revealed more improvements where scheduled. It was evident the owners were proud to call this building home by wisely spending money to update and maintain the structure and common areas of their building.

Although the reserve fund was not as strong as the first building, it was clearly demonstrated that the owners in this building were actively involved in maintaining and increasing the collective value of each owner’s investment. The proof of higher value in the second building was demonstrated through sales of $20,000-$40,000 more for the same type of condo as compared to the first building. Through research and analysis my client bought a condo in a superior building which will protect and increase his investment in the future.

Are we there yet? On March 28, the city’s Standing Policy Committee voted in favour of a “new” curbside recycling program policy, which is to be voted on by city council on April 16, 2007. This new and improved version will see 300,000 homes (including up to 4-plexes) see weekly pick up of recyclables, including plastics, but excluding food and yard waste. The existing city run recycling depots, totaling nearly 50, located across the city will continue to be operated. This is a great step towards achieving the city’s goal of recycling 80% of the city’s waste material by 2020.

The 2006 city civic census reported a total number of 408,543 residential units. Yet only 300,000 residential units will be served by the new recycling policy, if adopted. More than 25% of the city’s residential units will not have curbside recycling offered to them. It is safe to assume that this number encompasses condominium buildings over 4 units and their residents.

What recycling options are there for condominium dwellers? The city has said the existing recycling depots will remain in place. However, how practical is it for a person who may not have a vehicle to transport their recycling materials to one of these depots, either by foot or on the bus? Other options must be analyzed. Condominium corporations need to look at implementing a recycling program of their own.

As the city has found, there is a monetary cost that accompanies any recycling program. It must be taken into account, however, that an expenditure outlay for a recycling program is accompanied by monetary savings in other areas (not needing to build and maintain another land fill for example). The same is true for condominium buildings. Keep in mind the City of Calgary does not pick up waste from condominiums. This expense is paid for by the owners through their condo fees and can range from a few thousand dollars a year to tens of thousands of dollars for large buildings. By decreasing the amount of “waste” picked up at a decreased cost and allocating those funds for “recyclables” to be picked up would most likely not be any more expensive for the average condo building.

There are already numerous buildings doing exactly this. If yours isn’t, ask the question why. Then put a plan in place to begin. Recycling in condos: Because we can!

Condo plan or proposed condo plan, bylaws, annual general meeting minutes, last 12 months of board minutes, monthly unaudited financial statements, reserve fund study, plan and amount in the fund, management agreement, insurance certificate, percentage of owner occupied units, lease agreements pertaining to parking stalls. These documents and perhaps more depending on the condominium building form the package that all potential condo owners should review and be satisfied with prior to finalizing a conditional offer on a condominium unit. If the list seems a bit daunting (and it should) there is good reason. In addition to purchasing the unit you are also purchasing part ownership in the condominium corporation, a corporation that can have a great impact on your quality of life (ie bylaw restrictions) and your pocket book (potential cash calls).

Any sound, professionally prepared offer to purchase should contain a buyer’s condition that the buyer is given all condominium corporation documentation and upon receipt of all documents have the opportunity to review and be satisfied with them. Where most offers fall short is that the time frame to review these documents is time specific and not tied to when the final document is provided to the buyer.

It’s more often the case than not that sellers do not have on hand all the required documentation to provide to a buyer when an offer is accepted. The scramble begins to locate or order from the management company the required information. If the condition date is a specific calendar date this puts the buyer at a disadvantage in terms of having enough time to review the documents. In the case of new condominiums this situation is resolved by the Alberta Condominium Property Act which states any prospective buyer has 10 days, upon receipt of all documents to review them and be satisfied with them.

As condominium ownership has become a greater segment of the real estate market the awareness of the importance of the condominium corporation documents has increased. This is evident in the number of companies a buyer can hire to review these documents on their behalf. Only seven years ago there were a handful of companies in the city that offered this service. If a buyer thought to have anything reviewed more often that not they consulted with their lawyer. Although lawyers play an integral role in the buying and selling of real estate, their expertise is not in deciphering condo documents. Today buyers have a choice of more than a dozen reputable companies capable of the task.

Given the scope of the financial commitment a buyer is making with condo purchase and that a buyer has to abide by the corporation’s bylaws (can you have a pet, are there age restrictions) the old adage “Assume Nothing” is most appropriate to adhere to. The cost of having documents professionally reviewed will pay dividends in the future!

When you are looking to purchase a condominium it is important to make any offer subject to your review and approval of the condominium corporations documents. Part of those documents will include the year end financial statements along with the most current unaudited monthly balance sheet. If you are not an accountant by trade, what do all these numbers mean? And do they really matter?

The year end financial statement looks at the financial health of the condominium corporation over the past 12 months, comparing the year end figures to those of the previous years. The amount of income generated through condo fees and other sources is compared to the total expenses (budget) of the corporation. Any shortfall or surplus is noted. The amount contributed to the reserve fund is also noted along with whatever was spent during the year and disclosing the total amount present in the fund.

It should be noted that not all year end financial statements need to be audited by an accountant. The Alberta Condominium Property Act does not specify this requirement. A condo corporation bylaws will dictate if this is a necessity, although even if the bylaws don’t require it, it is a good idea for transparency to have this done. It is not unusual for smaller, self managed buildings to not have the year end financials audited. Also keep in mind that year end financials can take several months to be reviewed by an accountant and the final report prepared. If the corporation’s year end is December 31, the financials for that year may not be available until March!

Given that the year end financials can be several months out of date, it is important to verify the financial health of the corporation by reviewing the most current monthly unaudited balance sheet. This document will outline how much cash is in the corporation’s general operating account as well as the reserve fund account balance, what bills are outstanding (liabilities) and what accounts receivable are outstanding.

As with many things, looking at only one or two documents alone will not give you the full picture. The year end financials and monthly balance sheet must be viewed in the context of the entire package of documents provided. For instance, the balance in the reserve fund may look like a lot, but if the amount is less than the reserve fund plan specifies, you may want to ask further questions. A low operating account balance may not be as alarming if a special assessment has been called to address the shortfall.

As always, it is prudent to utilize the services of condominium specialists, both in the buying and selling of condominiums and in the review of the condo corporation documents. Good luck with your condo purchase!

June 30 has come and gone and along with it the deadline for paying our property taxes in Calgary (if you are not on the TIPPS program). Most of us know that our taxes are based on the value of our property as of the previous year. Take a moment and think ahead to, June 30, 2007. The amount of that tax bill will be based on the value of your condo now. We all know what has happened to property values in Calgary over the past 12 months. If the average price of property has increased 40% it stands to reason that your tax bill will go up 40%, as well. This doesn’t take into account the planned increase the city has already budgeted for.

Does the Fair Market Value method of taxation calculation put an unfair burden on condominiums, especially inner city condos? The values of inner city condos have seen phenomenal increases over the past 24 months, due in large part to their proximity to the city core. Have these properties put any additional strain on the city budget? Do they require or need new roads to be built, new utility services installed, new schools built, additional transit and garbage pick up planned, or even shopping centres to be developed as is the case in numerous subdivisions being constructed around the city? The obvious answer is no. The inner city condos already have infrastructure in place to accommodate the residents in them. It seems inequitable then that the tax collected from them is being used to subsidize further urban sprawl.

Our city is grappling with the growing pains of a successful economy (road congestion, children being bused long distances to school, longer commutes to work, etc). What if City Hall were to turn the question around. Instead of focusing on better ways to move people into the suburbs, why not find a way to get more people closer to the core, where they obviously want to be!

If you want to people to pay attention, make it financially attractive to them. One suggestion is to offer a reduction or subsidy on condominium property taxes if the condo is located within a certain distance from the city centre. This would encourage people to look at property ownership closer in nd would help alleviate the strain on the city of providing additional infrastructure in outlying communities.

This may seem a controversial option now. 12 months from now, when a 900 SF 2 bedroom condo in the Beltline is saddled with a $4000/year property tax bill, this option may gain a great deal of support!

Starting in early January the City of Calgary mailed out the 2008 Property Tax Assessments. In almost all communities of the city the average value of properties as estimated on July 1, 2007 went up over the July 1, 2006 value. It seems this year, more than in previous years, home and condo owners are confused about the assessed value of their properties. Here are some explanations for that confusion.

The 2008 property taxes in Calgary are based on values from 6 months ago. Since the end of June, 2007 property values in Calgary have experienced some adjustment. The average MLS condo sale price for the month of June, 2007 was the third highest on record for the Calgary Real Estate Board. Since then average values have decreased 6 %. Remember, your tax assessment is based on values from 6 months ago, not today’s value. In the previous 2 tax years as values went up steadily, the taxpayer reaped the benefits of the rising market, by paying taxes on the previous year’s lower value. 2008 is the flip side of that rising market.

It is important to remember that the tax assessment system is more art than science. Errors will occur and the city has an appeal process in place to deal with that. Consider that condos in the same building of the same size and features are assessment thousands of dollars difference in value. Why? Several factors can come into play. A view in one is of course worth more than a suite without a desirable view, an unrenovated condo has less value than one renovated, a premium will obviously be assessed to a penthouse suite over a unit several floors beneath it. Errors in the system do occur. A beltline condo I had listed at the beginning of this year for $499,900 was assessed at $851,000! No amount of market correction can explain that. Needless to say the owners are appealing that assessment.

Another source of confusion for condo owners this year has been the assessed value for their titled parking stalls. Five years ago inner city stalls were almost all assessed $5000. Two years ago many jumped in value to $10,000. Many of my clients this year are calling to voice their shock over their stalls assessment of $30,000. Keep in mind the city uses fair market value to determine property values. Yes, a parking stall in downtown Calgary is easily worth $30,000. New condo developments in the inner city sell extra stalls for this amount and more. If this is what they sell for on the open market it makes sense the city is going to collect tax on it.

No matter what your property is assessed it is important to keep in mind where your tax dollars go. Transit, roads, garbage pick up, utility maintenance, libraries, community and recreation centres, parks, schools, emergency services, green spaces and so much more that our city offers are paid for by our tax dollars. All in all, Calgary is a pretty great place to live. If, however, you feel you are paying more than your fair share your notice of assessment has information on how you can appeal the value of your condo.

Nearing the end of 2007, it has been a healthy and robust year for condominium sales in the city on the MLS system. Nearly 8000 condos have been sold on the MLS this year. Add to this number the thousands of condominiums sold by developers privately, and Calgarians continue to embrace condo ownership. This decision is not always motivated by a more affordable price point. Calgary is seeing more and more million dollar condos. At the end of November, 29 condos over $1,000,000 had sold on the MLS this year.

Selection for condo buyers has greatly increased in the past 12 months. Total inventory on the MLS is up over 35% from last year at this time. This means that sellers are finding themselves having to wait a bit longer to sell their condos. The average number of days to sell a condo in November was 44, compared to 36 days in November 2006. Gone are the days of buyers missing out on listings because they sold in days or hours, like they did in the spring of 2006!

Overall, prices for the condominium market have remained strong. Yes, the average price has dropped since the high of $332,237 in May of this year. Year over year, though, the numbers are moving up. The average price for a condo in November 2007 was $312,710, up over the November 2006 average of $282,781.

A trend to watch that may have a large impact on the condominium market is the number of vacant properties for sale. Currently over 40% of all condominiums for sale on the MLS are either vacant or newly constructed (never occupied) suites. Typically you would see about 30% of suites vacant. In the past 2 years many buyers purchased suites in buildings that were under construction with the intention of selling them (flipping them) as soon as they take possession. Many of these suites are now nearing completion and a large percentage of them may find their way onto the MLS system, further increasing inventory.

Since December 2006, the average price of condominiums in Calgary has increased 11%. At the start of 2007 the Calgary Real Estate Board predicted condo pricing to increase by 9%. All in all the year has been positive for the condominium market. What will 2008 bring? Sorry, my crystal ball is in the shop!

Condo living means many things for many people. Simplified maintenance, more personal time, ease of part-time residency, co-operative management of shared common property, increased safety, affordability and many more, as varied as the people who own and live in condos. One important aspect of condo living that will be gaining greater attention is the positive impact condominium buildings, condo owners and condo corporations can have on our environment.

The impact of global warming on our environment is in the news daily and it is impossible to avoid or dispute that it negatively affects each and every one of us. Every Canadian is responsible for contributing an average of 23 tonnes of green house gases into the atmosphere every year! To help combat this, the Federal government has recently announced several initiatives for home (condo) owners to help reduce green house emissions by “greening” their homes through reducing the amount of energy consumed. Although firm details will be announced later in the spring, the government is proposing a $5000 rebate to home owners to cover the costs of increasing their homes energy efficiency. Presumably this could go towards the purchase of a high efficiency furnace, increasing the insulation in the home, installing more energy efficient windows and other similar “green” upgrades. But how can condo owners take part in this and make a difference?

Condo living already means owners work as a collective to focus on the needs and goals of all owners. It is an easy step to direct the same collective energy to find ways to reduce the carbon footprint of a condo building. If individual condo owners pool their $5000 rebates and put those funds to greening the building as a whole, the financial impact on individual owners would be quite minimal. Initiatives could include the installation of motion sensor lighting in hallways and/or parkades that only come on when someone is present, replacing old windows with double or triple pane windows, changing incandescent light bulbs to lower energy consumption florescent bulbs and reducing the temperature of the parkade. All are substantial steps a building and condo owners can collectively take to address the issue of reducing carbon emissions. As if saving the planet were not enough reward, there is the potential for condo fees to decrease when less energy is used in the building!

Enmax and Direct Energy, two of the leading energy suppliers in Calgary, already have programs in place to help condominium buildings analyze and reduce the amount of energy consumed. I encourage each and every condo board in the city to take on the challenge of reducing the amount of energy used for their building.

Imagine flying over the downtown core and below you is a checkerboard of green gardens and oasis’. Sound improbable in our highly populated inner city? Calgary has a surprising amount of wasted open space. In the densely packed downtown core including the areas of Eau Claire, West Downtown and the Beltline, prime real estate space atop roof tops is given too little consideration in a city that values each square foot so highly. These unused spaces can offer extensive benefits to city dwellers, developers and concerned citizens alike when retro-fitted as “green roofs”.

A green roof consists of a waterproof, root-repellent membrane, drainage system, filter cloth, lightweight growing medium and vegetation ranging from grasses and plants to trees. A few of the benefits green roofs offer include:

• Providing much needed amenity space for building users
• Increasing the roof life span
• Reducing storm water run off
• Providing noise insulation
• Filtering pollutants and CO2 out of the air
• Providing locally grown food (from roof-top vegetable gardens)
• Increasing habitat for birds in built-up areas
• Reducing heating (by adding mass and thermal resistance value) and cooling (by evaporative cooling) loads on a building
• Reducing the urban heat island effect

For the vast majority of people, emerging technologies and new ways of thinking need to make economic sense in order to be embraced. True, the construction of a “green roof” can be as much as twice the cost of a conventional roof, even though the public and private benefits are numerous. Successful “Green Roof” initiatives in Toronto, Chicago, Portland, Minneapolis and New York have implemented incentives for developers to incorporate at least 75% coverage of new building roofs as “green” in exchange for increased zoning density. Other initiatives could include tax incentives to retrofit existing buildings to “green roofs”.

Could this type of policy driven change be adopted in Calgary? Calgarian’s are quick to apply the spirit of “because we can” to a situation to improve it for the better. Our cities high rates of volunteerism is a great example of the “Because We Can” spirit so prevalent here. Why should our city’s stakeholders look to green the rooftops of Calgary? Simple answer:

“Because We Can!”

Maybe you have heard of the residential rental crunch the city of Calgary is experiencing this year. According to Canada Mortgage and Housing Corporation, Calgary’s vacancy rate is below 0.5%. The situation has been so extreme the U of C’s student union put out a call for Calgarian’s to consider housing a student for the year, due to the remarkably low number of affordable suites available for students to rent. Obviously there is a need for more rental suites in the city and not just the “affordable housing” that is in the headlines.

Combine this with the large supply of properties currently for sale in the city and the savvy investor will see an opportunity in the market. In the inner city alone there are nearly 200 condos for sale under $300,000, many of which would make excellent investments as rental units. Finding a tenant is not a problem in today’s tight rental market and there are solid investments to be found with the abundance of properties to buy.

Given the real estate environment in the city you may be looking to expand your investment portfolio into real estate. Of course the question becomes where to start. Begin with a call to your banker or mortgage broker. You may also want to speak to your tax accountant to explore how owning a rental property will affect your tax position.

Once you know what price point to focus on, start looking at properties. But why look to condos and not single family houses? Several reasons jump to mind: less property to manage and maintain (ie roofs, fences, furnaces, etc), the initial investment is lower due to the lower price point compared to single family homes and typically there is less wear and tear on the suite based on renter demographics. Proportionally, the rent received per dollar invested can be greater in inner city condos compared to single family homes.

If the condo rental market looks good to you, find a realtor who specializes in the condo market segment to guide you through the purchase process. You may also want to explore the option of having a management company look after the property, find tenants, collect rent, etc. Consider the option of renting the property fully furnished, which will bring in much larger rental income. Find out what different types of properties are renting for; a one bedroom suite verses two, with parking and without, one community compared to another, etc. In addition to looking in the classifieds section of the local paper for this information there are several online classified rental sites for the Calgary area that are excellent, including pictures and greater detail than the paper offers. In addition, once it is time to find your future tenant you can utilize these sites at a very reasonable rate.

It is important you familiarize yourself with the laws pertaining to landlords and tenants in Alberta. Check out www.servicealberta.gov.ab.ca as well as www.landlordandtenant.org for more information. Good luck with your income property!